Critical decision on NJ health-insurance exchange due this week

Governor Christie must make the first of several key decisions this week about how New Jersey will implement national health care reform, now that Election Day is over and Obamacare is unlikely to be repealed.

By Friday, the governor must declare whether the state will set up its own health-insurance exchange, which is an online market for insurance, or let the federal government do it instead.

The exchanges are a critical element of the health care reform law because they simplify the purchase of health plans and enable individuals and small-business employees to find out if they’re eligible for federal subsidies. Applications are to be accepted starting Oct. 1, with coverage starting in January 2014.

“New Jersey has 1.3 million uninsured,” said Jeff Brown, health care advocate with New Jersey Citizen Action. “The governor’s decision is going to affect hundreds of thousands of people.” Once the type of exchange is decided, he said, “then the real work begins in terms of making sure people get insurance.”

About 250,000 people in the state are expected to be able to buy insurance on the exchange in its first year. But most of them don’t know they’ll be eligible — one indication of the vast amount of work that needs to be done if the benefits of the reform law are to be realized.

Christie’s decision is both political and practical — and has implications not only for New Jersey’s uninsured but for his national political ambitions.

Christie campaigned around the country for Republican presidential nominee Mitt Romney, who announced he would repeal Obamacare as soon as he took office. But while Christie was denouncing the president’s health care reforms, he had state officials laying the groundwork for their eventual implementation if President Obama was reelected.

Now, the time has come to act, both opponents and supporters of the health care law agree.

“The governor has tried to kick the can down the road on this issue,” said Steve Lonegan, head of the state chapter of Americans for Prosperity, a group that supports limited government. “But now we’re out of road.”

Christie has not indicated what his decision will be.

“There’s all different kinds of options,” Christie said Monday. “I’ll decide which one I think is best.”

The greater the delay in creating the exchange, the longer New Jerseyans will go without health insurance and the more federal subsidies will be lost, advocates say.

It probably won’t make much difference whether the state or the federal government runs the exchange, for those who buy insurance on it. But a state-run exchange could be integrated with New Jersey’s existing, longstanding individual and small-group insurance markets, and avoid the confusion and duplication of a separate, federally regulated market for insurers and customers.

The most important issue, advocates say, is to get it up and running soon.

“Enough with the foot-dragging,” said Ray Castro, an analyst with New Jersey Policy Perspective. “The governor should sign the exchange bill immediately.” Several states already have theirs. Further delay could mean thousands of people miss out on coverage on the start date of Jan. 1, 2014, and the loss of millions of dollars of federal subsidies that will be available, he said.

In New Jersey support for Obama and his health care reform package clearly is strong, based on the margin of the president’s victory last Tuesday. The cost of health care ranks high among voter concerns, pollsters say. With so many people lacking insurance, any steps to enroll more of them — and lessen the burden of charity care on hospitals and the way those costs are passed on to those with insurance — are welcome.

But 10 states across the country already have announced they won’t set up their own exchanges or partner with the federal government to run them. The day after the election, for example, Kansas Gov. Sam Brownback, a Republican, said his state couldn’t afford it. And a ballot initiative last Tuesday prohibited Missouri’s governor, a Democrat, from setting up a state-based exchange without legislative approval; the legislature doesn’t return until January.